Footing the Bill

The Boulder apartment David Wittlinger rented for his final year at the University of Colorado wasn't great, but it was okay--until the weather turned cold. The furnace never worked, and calls to the owner and the property manager yielded no heat. Because space heaters would blow a fuse, Wittlinger shivered. It got so cold that his pipes broke, ruining some of his stuff and leaving the apartment without water. "It was warmer outside than in my bedroom," Wittlinger recalls.

Finally, Wittlinger called his father, a lawyer in Michigan, who explained that there are laws that protect tenants from such places. If he moved out, his father told him, he would get his deposit back.

Wittlinger's father was wrong. Colorado has no law that specifically protects tenants from unscrupulous landlords. Forty-six other states do--but they don't have lobbyist Frank "Pancho" Hays.

Legislators considered adding a law this session to protect people like Wittlinger. But thanks to Hays, the effort failed.

Senator Stan Matsunaka, a Democrat from Larimer County, sponsored a bill to put a "warranty of habitability" into state law. The warranty is a guarantee that landlords provide heat, running water and "other essential services" to tenants. The language in Matsunaka's bill came from the National Conference of Commissioners on Uniform State Laws; similar language has been adopted in fifteen states, including such conservative bastions as Arizona and Idaho. (Most other states have at least some protection for tenants, if not this specific "warranty.") Even some conservative GOP lawmakers in the real estate business thought the rules would be fine. "That's the way I run my business, and I don't have a problem seeing this put in the law," says Ben Alexander, a senator from Montrose who owns rental housing and is a property manager.

Matsunaka's bill was first heard by the Senate Business Affairs and Labor Committee, on which he sits. With the help of testimony he marshaled from students who told stories similar to Wittlinger's, the bill passed the committee. On the Senate floor, Matsunaka was able to garner support from all fifteen Democrats and three Republicans, including Tillie Bishop of Grand Junction, who had his own horror stories about an apartment he rented in Denver during the legislative session. With those eighteen votes, the bill passed the Senate and went on to the House--where it ran into Pancho Hays.

Matsunaka says that when he saw Hays in the House Business Affairs and Labor Committee hearing room before the panel voted, he started getting that queasy feeling. "As soon as I saw him," says Matsunaka, "I knew we were sunk." Committee chairman Paul Schauer, a Republican from Littleton, denies any undue influence from Hays, but he adds that Hays is a "trusted voice" at the legislature. "He does his homework on the issues," says Schauer. And the panel chair also says that business interests--such as associations of apartment owners and the real estate lobby--simply have an advantage over, for example, groups such as students fighting for a tenant-rights bill. "It all boils down to the dollars," says Schauer.

And Hays is one guy who controls the dollars. A sizable chunk of his income is from real estate interests, including $21,499 from the Colorado Association of Realtors, for whom he was working against the tenant-rights bill. Records also show that he's paid by more than thirty other companies, groups or political action committees to carry their water. And he leads a den of lobbyists hired by tobacco companies.

Buttonholing lawmakers is only part of his job. He also gathers checks from companies and PACs and distributes them to legislators' campaign war chests. So when a politician gets a check from certain PACs, it may come in an envelope from Pancho Hays. "He sends you a letter with the check and he even tells you that you should send a thank-you note and who you should send it to," says one Republican legislator who asks not to be named for fear of offending Hays. Another Republican lawmaker adds, "He is very effective at letting you know that the money came through him." But Hays's work as a conduit is not reflected in campaign-finance disclosure records: A candidate does not have to say who delivered the check.

That means that this link between campaign assistance and lobbying leaves little paper trail. But some lawmakers say it is that link that makes Hays--and to a lesser degree, other lobbyists--so influential.

Schauer says that he can't remember exactly which of his campaign dollars were delivered by Hays but that he wouldn't be surprised if several of his big checks came through him. In his last run for the House, Schauer got $500 from the realtors' PAC.

Hays says he pointed out to members of Schauer's panel that another bill on the same issue was on its way. And that bill, introduced by Representative Debbie Allen, a Republican from Aurora, also contained provisions favorable to landlords. "You know, there are lousy landlords and there are also lousy tenants," Hays says.

The owners of several large apartment complexes in Allen's district asked her to push for laws that would make it easier to kick out tenants who are arrested for breaking the law while in an apartment but have not been convicted. (Allen's campaign records list contributions from the realtors and the Colorado Apartment PAC, which represents landlords.) Her first version of the bill also contained a "warranty of habitability" worded exactly the same as Arizona's law. But Hays went to Allen with a recommended change.

"I told her we could draft a bill that would reflect essentially what the case law is now," Hays says. In other words, Hays suggested that she remove the warranty of habitability. The revised bill included no new protections for tenants and several new rights for landlords. Allen says she was comfortable with the change.

The measure--now a landlord-rights bill--passed the House and went to the Senate Business Affairs Committee. There Matsunaka says he had a choice. He could try to amend the bill a little in an effort to give a few crumbs to tenants, amend the bill back to a true warranty of habitability, or just work to kill the entire measure and try again next year. During the Senate panel's hearing, Hays, listing himself as "neutral," testified in favor of Allen's bill. Matsunaka, working with the bill's Senate sponsor, Republican Elsie Lacy of Aurora, tried to get one paragraph inserted that provided a way for tenants to move out and get their security deposits back if the apartment or home had no heat, hot water, running water or other essential items.

Matsunaka and Lacy got Tom Bastien, a lobbyist with the Colorado Trial Lawyers Association, to write the paragraph. He submitted it in a memo to both senators and included one line at the end: "I will give a copy of this proposal to Pancho Hays."

The bill passed committee, but the provision to aid tenants was removed on the Senate floor by Lacy herself and replaced with a watered-down provision. "We took that out because we didn't think we could keep support for it on the floor," Lacy says, adding that Hays told her she didn't have the votes. "He's been around long enough that he knows what will pass and what won't." (Lacy, the chair of the Joint Budget Committee, has received campaign contributions from many political action committees, including the realtors' PAC and the Colorado Apartment PAC.)

The version of the bill the Senate finally voted on was unacceptable to Matsunaka. Other Democrats joined him, as did a few conservative Republicans who couldn't even tolerate the watered-down paragraph. The bill was defeated. When pressed, Hays takes credit for singlehandedly beating it, saying, "I would say that's not an unfair statement for this session."

It certainly wasn't the first time Hays had successfully intervened on an issue. He helped Envirotest gain a monopoly in auto-emissions testing, pushed through a bill last session enabling the Denver Broncos to get a public vote on a new stadium and has worked hard to make sure that even the most modest of anti-tobacco legislation dies. When there is a tobacco-related bill, says anti-tobacco Republican representative Martha Kreutz, tobacco companies will fly groups of lawyers to Denver from Washington, but Hays is the one who deploys them.

Kreutz acknowledges the obvious: The money Hays and others generate for campaigns is important. "Money is the mother's milk of politics," she says. But Hays is also good at the little things, according to Kreutz. "If you carry a bill for one of his clients," she says, "he'll do all the work, make all the calls, arrange for all the testimony in committee, and then he'll make sure that you'll get all the credit."

While Matsunaka might have a reason to be irked about Hays's work on the tenant-rights legislation, he says he has no hard feelings and wants to try to find an acceptable compromise next session. Matsunaka also says he's learned his lesson about how he should spend his time. "Next year," he says, "Pancho will be the first person I call."

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